HKD: HKMA Intervenes Again To Protect 7.8500 Level, Limited Spot Reaction

• RES 3: 96.501 - 76.4% of the Mar 14 - Nov 1 ‘23 bear leg
• RES 2: 96.207 - 61.8% of the Mar 14 - Nov 1 ‘23 bear leg
• RES 1: 95.960 - High Apr 7 
• PRICE: 95.780 @ 16:22 BST Jun 13
• SUP 1: 95.415/95.300 - Low May 15 / Low Jan 14  
• SUP 2: 95.275 - Low Nov 14  (cont) and a key support
• SUP 3: 94.707 - 1.0% 10-dma envelope

Aussie 10-yr futures rallied well on the RBA rate decision, reversing a small part of recent weakness. Recent price action pressured prices through to new pullback lows last week. Next support undercuts at 95.420 (pierced), the Feb 13 low, ahead of 95.275, the Nov 14 low and a key support. Clearance of this level would strengthen a bearish condition. To the upside, a recovery of recent losses would shift attention to resistance at 96.207, a Fibonacci retracement point.

TYU5 reopens at 110-20+, up 0-01 from closing levels in today’s Asia-Pac session.

• Friday night the US 10-year yield had a range of 4.3141% - 4.4442%, closing around 4.40%. 
• Treasury yields ended higher on the night, led by the long-end helping the yield curve steepen (2s10s +0.18 at 44.908, 5s30s +1.76 at 89.060).
• MNI US DATA: U.Mich Inflation Expectations Seem To Be Affected By Weight Change. The U.Mich consumer survey saw surprisingly low near-term inflation expectations in the preliminary June survey, at 5.1% (cons 6.4%) for 1Y out after 6.6% in May. The 5-10Y meanwhile was as expected at 4.1% after 4.2%.
• “Federal Reserve officials are signaling an extended hold on interest rates, and investors and economists will look to Chair Jerome Powell for clues on what might eventually prompt the central bank to make a move.”(BBG)
• The 10-year yield has bounced strongly off its 4.30/35% support, this area needs to hold if yields are to move higher. A sustained break back below 4.30% and you would think more shorts will be pared back potentially putting a short-term top in place. It seems traders for the moment are more concerned with the move in oil and the implications it has for inflation than buying treasuries as a safe haven.

• RES 3: 97.190 - High May 5 2023
• RES 2: 96.932 - 76.4% of Mar-Nov ‘23 bear leg 
• RES 1: 96.860 - High Apr 07
• PRICE: 96.640 @ 16:21 BST Jun 13
• SUP 1: 95.900 - Low Jan 14  
• SUP 2: 95.760 - Low 14 Nov ‘24
• SUP 3: 95.480 - Low Jan 11 2023 and a major support 

Aussie 3-yr futures rallied off lower levels on the RBA rate cut and guidance, however prices remain south of the 50-dma for now. The recent rally took out resistance at 96.730, the Sep 17 ‘24 high, however momentum faltered, leaving 96.860 resistance intact. This remains the key level to the upside.  Instead, a continuation lower would strengthen a bearish theme. This would refocus attention on 95.760, the 14 Nov ‘24 low. Conversely, a reversal higher would refocus attention on 96.860, the Apr 7 high.